United Parcel Service: Supply Chain Integration

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Table of Contents

Introduction
Organizational structure
Integrating information technology to the supply chain
Conclusion
Reference List

Introduction

United Parcel Service (UPS) is a delivery and logistics company based in Atlanta, Georgia. However, the company has operations in various parts of the world.

UPS delivers an average of 13.6 million packages on each business day. It has more than 8 million global customers (Niemann, 2007). Although the company’s core business is in the delivery of documents and packages, over the years, this has evolved to include supply chain management.

The company’s promise of guaranteed product delivery, coupled with a vast transportation infrastructure has given it a commanding position in the global supply chain industry.

This is a very competitive industry and in order to remain in the market, UPS has had to integrate information technology into its existing global supply delivery and supply chain network.

By embracing information technology, UPS has managed to make efficient deliveries to its customers while still maintaining its competitive prices.

Organizational structure

UPS’ business operations are conducted through several business units. UPS Air Cargo conducts airport-to-airport freight deliveries to more than 150 airports across the globe. UPS Capital Corporation is the financial arm of the company. It offers working capital to small businesses (Fleishmann, 2007).

UPS Supply Chain Solutions enables customers to access the company’s portfolio of services. The supply chain solution has been developed in such a way that it meets the global supply chain needs of the company’s customers.

UPS Aviation Technologies provides products for corporate operators, general aviation, airlines, as well as air-traffic control.

UPS Stores delivers personalized, convenient business solutions via a global network of independently operated and owned communication, shipping and business centers.

On the other hand, UPS TeleServices offers a wide range of call center services to the over 13 million packages delivered every day (Fleishmann, 2007). Another unit, UPS Professional Services, provides strategic business solutions through expert financial analysis, leveraging on innovative technologies and time-proven logistics.

Integrating information technology to the supply chain

The adaption of modern technology has enabled UPS to revolutionaries its supply chain management (Decker, Engleman & Petrucci, 1999). This has seen the company adopt freight, billing and wireless technology in a bid to grow its supply chain and shipping requirements.

These technology solutions are mainly web-based and they will help the company to realize cost efficiency. As supply chain management becomes increasingly competitive, UPS has been forced to embrace modern technology in order to remain competitive in the international market.

One such technology that the company is banking on to enhance its competitive edge in the international market is wireless technology. The adoption of this particular technology is aimed at augmenting the company’s value chain.

The wireless technology that UPS has rolled out on a global scale includes Wi-Fi, Bluetooth, as well as various cellular systems (Fleishmann, 2007).

The above mentioned technologies have found use in the company’s sorting and packing centers. Here, a package sorter can example, easily and quickly scan bar codes to the various parcels using a Bluetooth finger ring. The scanned data is then transmitted to a Wi-Fi device worn by the package sorter around his/her belt.

Deployment of technology has now become part of UPS’s global competitive advantage. Ever since UPS has realised embraced modern technology, it has benefited from an improved and flexible working environment for its employees, in addition to time savings (Fleishmann, 2007).

Another technology that UPS has adopted in order to improve efficiency is the Delivery Information Acquisition Device (DIAD). This particular device integrates Wi-Fi, Bluetooth, Global Position System (SPS), and GSM networks.

This device has proven very effective in enabling the company’s drivers to navigate customers’ sites. Data is transmitted to the company’s UPS centers via wireless LAN connectivity (Brewster & Dalzell, 2007). This enables the management to monitor the transport infrastructure.

In addition, DIAD also transmits delivery information to the company. This way, the company knows that the parcel or document has reached its intended destination. In addition, the system also enables UPS customers to obtain tracking and shipping information of their products using wireless solutions.

Some of the benefits of this particular technology include accurate and timely delivery of information. This has led to satisfied customers.

New technologies have given UPS a competitive edge in the market. In addition, UPS can also use its new technologies as a barrier to entry of new players in the market. It also acts as a form of product differentiation, thereby giving UPS a competitive advantage in the market (Boulton, 1999).

Embracing new technologies has also enabled UPS to enhance supply chain outsourcing, thereby saving on supply chain costs. UPS and Yahoo have also entered into a partnership that enables the company’s customers to open individual online stores, in effect benefiting from integrated shipping tools and discounted prices.

Web-enabled shipping procedures and flexible shipping options mean that customers can now track goods from a single location. Embracing new technologies has also seen UPS adopt a more efficient billing solution.

Bills are now delivered every week via U.S Mail. UPS also has a Billing Center where customers can view their import and export invoices online, and generate real-time information (Brewster & Dalzell, 2007).

The billing system has also enabled the company to develop online payment systems, reduce paperwork, enhance productivity, and streamline payment and invoice processes.

Conclusion

UPS has integrated information technology into its global supply chain. This has allowed the company to improve its efficiency and provide high quality services at an affordable cost.

As a result, UPS has managed to gain a commanding lead over its competitors such as FedEx. Not just in the package delivery, but also in the logistics business. New technologies such as GPS and Wi-Fi have enabled UPS to differentiate its products from those of its competitors, and hence improve its competitive advantage.

Reference List

Boulton, W. R. (1999). United Parcel Service: Moving at the Speed of Business. Web.

Brewster, M., & Dalzell, F. (2007). Driving Change: The Ups Approach to Business. New York: Hyperion Books.

Decker, K., Engleman, S., Petrucci, T., & Robinson, S. (1999). United Parcel Service and the Management of Change. Web.

Fleishmann, G. (2007). UPS Starts Wireless Logistics Deployment in Europe. Web.

Niemann, G. (2007). Big Brown: The Untold Story of UPS. New York: John Wiley & Sons.

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